Regulation is often thought to discourage innovation. This problem is not evidenced by electric utility behavior up through the mid-1970s, during which time utilities adopted various new generation technologies. However, retrospective "prudence" reviews, common since the 1980s, may discourage...

Since the emergence of a spot market in natural gas in 1984, state regulators have been concerned that regulated utilities would fail to choose between contracts and spot purchases in a way that minimizes costs. Grounds for this concern are shown, under two alternative rate structures, in a...

We present a model of the regulatory "contract" that focuses on the mutual investment of buyer and seller and recognizes the cost of contractual renegotiation and the importance of breach remedies when contracts are incomplete. We model renegotiation as a litigation game played before a...

In many markets, governments set minimum quality standards while some sellers compete on the basis of quality by exceeding them. Such quality leadership strategies often win public acclaim, especially when they involve environmental attributes. Using a duopoly model of vertical product...

Regulators sometimes review a regulated firm's input decisions in retrospect (i.e., with "20-20 hindsight") and punish bad outcomes rather than bad decisions. When such practices are applied consistently to contracts for variable factors in a regime with profit regulation, the firm increases its...

Under asymmetric regulation, different firms in the same industry are subjected to different levels of regulatory restraint. We analyze the nature of innovation rivalry in such an industry, emphasizing that a rival may be able to inexpensively imitate an innovator's successful new technology....

We examine the use of El Nino-Southern Oscillation (ENSO) forecasts for flood planning in the Pacific Northwest. Using theories of resource mobilization as a conceptual foundation, the paper relies on: 1) case studies of three communities vulnerable to flooding that have had access to long-term...

Abstract Environmental managers in Russia face severe problems, both from Soviet-era and continuing environmental degradation and due to the weakness of current institutions with responsibilities for environmental protection. This paper draws on surveys, a case study of water pollution, and...